Raja v. Burns

Us DISTHIGUT COURT EUAN,

x FEBS Ha x

UNITED STATES DISTRICT COURT .

EASTERN DISTRICT OF NEW YORK BROOKLYN OFFICE

Oooo EE □□

RIZWAN RAJA,

Plaintiff, MEMORANDUM & ORDER

19-CV-01328

-against-

JOHN W. BURNS and

THE CITY OF NEW YORK,

Defendants.

oo en nn one nn nnn ne 5 5 == == XX

ANN M. DONNELLY, United States District Judge:

On April 15, 2019, Rizwan Raja brought this action against the City of New York and

John W. Burns, the first deputy commissioner and supervising administrative law judge for the

New York City Office of Administrative Trials and Hearings (“OATH”). The plaintiff alleges

violations of his Fourth, Fifth, and Fourteenth Amendment rights under 42 U.S.C. § 1983, and

related claims arising under the New York City Charter and OATH rules. (ECF No. 14.) The

plaintiff moved for partial summary judgment on liability, and the defendants cross-moved to

dismiss the complaint. (ECF Nos. 22, 24.) I held oral argument on November 25, 2019. For the

reasons that follow, the plaintiff's motion for summary judgment is granted in part and denied in

part, and the defendants’ motion to dismiss is granted in part and denied in part.

BACKGROUND

I. Statutory Framework

Pursuant to Chapter 45-a of the New York City Charter, OATH is responsible for

conducting adjudicatory hearings for agencies of the City of New York. Charter § 1048(1).

OATH’s rules permit non-attorneys to represent parties appearing before OATH tribunals,

subject to certain requirements codified in Sections 6-23 and 6-25 of Title 48 of the Rules &

Regulations of the City of New York.

a. Section 6-23 Rules

Under Section 6-23, non-attorney representatives must register with OATH and renew

their registrations every year. N.Y. Comp. Codes R. & Regs. Tit. 48, § 6-23(b) (2019). A non-

attorney representative cannot misrepresent his qualifications or services “so as to mislead

people into believing [he] is an attorney at law or a governmental employee if [he] is not.”

Id. § 6-23(d). Non-attorney representatives may be disciplined for misrepresenting their

qualifications, failing to register or re-register, or failing to follow any other OATH rules,

including those prescribed in Section 6-25. Jd. § 6-23(f). Possible discipline includes “the

suspension or revocation of the representative’s right to appear before the Tribunal.” Jd.

b. Section 6-25 Rules

Subsection 6-25(a) defines prohibited conduct for parties, witnesses, and representatives

appearing before OATH. N.Y. Comp. Codes R. & Regs. Tit. 48, § 6-25 (2019). As relevant

here, a non-attorney representative may not submit false information to the tribunal (6-25(a)(9)),

or “[e]ngage in any disruptive verbal conduct, action or gesture that a reasonable person would

believe shows contempt or disrespect for the proceedings or that a reasonable person would

believe to be intimidating,” (6-25(a)(2)).

Subsections (c)(1) and (c)(2) of Section 6-25 authorize the Chief Administrative Law

Judge to suspend or bar representatives who “fail{] to abide by these rules,” but only “after the

attorney or representative is given notice and a reasonable opportunity to appear....to rebut the

claims against him[.]” fd. § 6-25(c). Subsections (d)(1) and (d)(2), however, authorize the Chief

ALJ to suspend or bar a representative summarily “upon a determination that the representative

lacks honesty and integrity and that the lack of honesty and integrity will adversely affect his or

her practice before the Tribunal.” Jd § 6-25(d). Factors to be considered in determining

whether a representative lacks honesty or integrity include “whether the representative has made

false, misleading or inappropriate statements to parties or Tribunal staff.” Id. § (d)(2).

After the summary suspension or bar under Subsection 6-25(d), “the representative will

be given an opportunity to be heard in a proceeding prescribed by the Chief Administrative Law

Judge or his or her designee.” Jd. An aggrieved representative may then seek review of the

Chief ALJ’s decision through Article 78 of the New York Civil Practice Law and Rules. Jd. § 6-

25(e).

IJ. Factual and Procedural History!

The plaintiff became a non-attorney representative registered to appear before the OATH

tribunal in 2005, after he passed an exam demonstrating sufficient knowledge of TLC rules and

regulations. (ECF No. 32, Defs.’ Response to Pl.’s Rule 56.1 Statement (“Defs.’ 56.1

Response”) □□□ 5-7.) As a registered representative, the plaintiff represents taxi drivers appearing

before the tribunal accused of rule violations and facing the possibility of suspensions or fines.

(id. {J 9-10.)

On March 1, 2019, OATH Assistant General Counsel Timothy R. Jones sent the plaintiff

an email informing him that he was “summarily suspended starting March 8, 2019” pursuant to

Section 6-25(d)(1). Ud. § 22) (quoting ECF No. 23-1) (emphasis in original). The email

attached a summary suspension letter detailing the allegations of the plaintiff's misconduct that

gave rise to the summary suspension, which included: (1) failing to register as a representative,

(ii) misrepresenting his qualifications to appear as an attorney, (iii) appropriating money under

' Unless otherwise noted, the factual background is based on my review of the entire record, including

the parties’ 56.1 statements.

false pretenses, (iv) submitting a false statement to the tribunal, and (v) engaging in disruptive

verbal conduct. (ECF No. 23-2 at 2.) The author of the letter, First Deputy Commissioner and

Supervising ALJ John W. Burns, concluded that the plaintiff should be summarily suspended

pursuant to Section 6-25(d)(1) because the “fair and credible evidence...indicates a lack of

honesty and integrity.” (/d. at 3.) Both the email and the letter invited the plaintiff to submit a

letter to Supervising ALJ Burns by March 22, 2019, if he wished to dispute the allegations of

misconduct. (Defs.’ 56.1 Response { 22.)

On March 7, 2019, the day before the summary suspension was to take effect, the

plaintiff filed this action and an order to show cause for a temporary restraining order. (ECF

Nos. 1, 3-4.) United States District Judge Pamela K. Chen denied the TRO after a hearing that

same day, and denied a motion for reconsideration on March 11, 2019. (ECF No. 9.) The

plaintiff submitted a detailed refutation of the charges on March 14, 2019, but OATH determined

that the plaintiff's suspension should not be lifted. (Defs.’ 56.1 Response 29, 36.)

On March 19, 2019, OATH filed a new set of charges—styled as a “petition” —seeking to

bar the plaintiff permanently from appearing before OATH. (/d. 4] 37-39.) The petition

contained many of the same charges from the summary suspension, but omitted the failure to

register and false statement charges, and added a new charge of misappropriating client funds.

(Id.) That same day, OATH informed the plaintiff that the charges in the petition would be tried

before an OATH ALJ on March 22, 2019. (id. ¥ 37.)

The hearing took place over three days, and ended on April 4, 2019. (/d. ¥ 46.) During

the hearing, two of the plaintiff's former clients testified against him, and the OATH prosecutor

submitted affirmations from two former clients who did not appear. (/d. § 47.) Near the end of

trial, the parties negotiated a settlement, which they finalized and signed on April 11, 2019.? (id.

The settlement agreement does not contain any admissions of wrongdoing on the part of

the plaintiff. (Jd. 7 50.)

On April 15, 2019, the plaintiff filed the operative amended complaint. (ECF No. 16.)

The plaintiff has been registered to appear as a representative before OATH since May 9, 2019.

STANDARD OF REVIEW

The plaintiff moves for summary judgment as to liability on the federal due process

claims in the amended complaint. Summary judgment is appropriate only if the parties’

submissions, including deposition transcripts, affidavits, or other documentation, show that there

is “no genuine dispute as to any material fact,” and the movant is “entitled to judgment as a

matter of law.” Fed. R. Civ. P. 56(a); see also Anderson v. Liberty Lobby, Inc., 477 U.S. 242,

247-48 (1986). The movant has the burden of showing the absence of any genuine dispute as to

a material fact. McLee v. Chrysler Corp., 109 F.3d 130, 134 (2d Cir. 1997) (citation omitted). A

fact is “material” when it “might affect the outcome of the suit under the governing law,” and an

issue of fact is “genuine” if “the evidence is such that a reasonable jury could return a verdict for

the nonmoving party.” Barlow v. Male Geneva Police Officer Who Arrested Me on Jan. 2005,

434 F. App’x 22, 25 (2d Cir. 2011) (internal citations omitted). Once the moving party has met

its burden, the party opposing summary judgment must identify specific facts and affirmative

evidence that contradict those offered by the moving party to demonstrate that there is a genuine

issue for trial. Ethelberth v. Choice Sec. Co., 91 F. Supp. 3d 339, 349 (E.D.N.Y. 2015) (citing

Celotex Corp. v. Catrett, 477 U.S. 317, 324 (1986)).

2 Accordingly, the plaintiff's summary suspension lasted from March 8 to April 11, 2019, or 35 days.

(id. 451.)

3 The parties confirmed the end date of Mr. Raja’s suspension during oral argument.

Although Rule 56 permits a party to move for summary judgment “at any time,” pre-

discovery summary judgment “is the exception rather than the rule and will be granted only in

the clearest of cases.” Wells Fargo Bank Nw., N.A. v. Taca Int'l Airlines, S_A., 247 F. Supp. 2d

352, 359-60 (S.D.N.Y. 2002) (internal quotation marks and citations omitted). “The Court must

consider several factors in determining whether to grant summary judgment in the absence of

discovery: (1) whether the lack of discovery was in any way due to fault or delay on the part of

the nonmovant; (2) whether the nonmovant filed a sufficient Rule 56(f) affidavit explaining: (i)

what facts are sought and how they are to be obtained, (ii) how those facts are reasonably

expected to create a genuine issue of material fact, (iii) what effort the affiant has made to obtain

them, and (iv) why the affiant was unsuccessful in those efforts; and (3) whether the nonmovant

provided any basis for its belief that further discovery would alter the outcome of the summary

judgment motion.” /d. (citing Berger v. United States, 87 F. 3d 60, 65 (2d Cir. 1996) (citation

omitted)).

None of those factors apply here. The parties do not dispute the factual history of the

plaintiff's summary suspension and hearing before the ALJ, or the terms of the OATH rules

authorizing the summary suspension.’ Rather, they dispute whether these undisputed facts

amount to violations of the plaintiffs constitutional rights to due process. Accordingly, I

adjudicate the constitutional claims as a matter of law. °

The plaintiff maintained at oral argument that there is still a dispute of fact about whether Mr. Raja

acted dishonestly or inappropriately in violation of OATH rules. The merits of the case against the

plaintiff are not the subject of this proceeding. In any event, the parties negotiated a settlement during

the trial on the subject of Mr. Raja’s conduct, a settlement that included no admission of wrongdoing.

Therefore, the merits of Mr. Raja’s suspension are moot. The plaintiff's challenge is to the process

provided to him, not an appeal of administrative fact-finding.

> The defendants have not filed a Rule 56(f) affidavit or claimed that they lack adequate information to

oppose the motion. Thus, they have waived any claim that adjudication of the plaintiff's motion for

partial summary judgment should await further discovery.

The defendants move to dismiss the entire complaint under Rule 12(b)(6). To survive a

motion to dismiss, a complaint must plead “enough facts to state a claim to relief that is plausible

on its face.” Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 570 (2007). This means that it must

“plead[] factual content that allows the court to draw the reasonable inference that the defendant

is liable for the misconduct alleged.” Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (citing

Twombly, 550 U.S. at 556). Although the complaint need not include “detailed factual

allegations,” it must be more than “a formulaic recitation of the elements of a cause of action”

and more than an “unadorned, the-defendant-unlawfully-harmed-me accusation.” Iqbal, 556

US. at 678 (citing Twombly, 550 U.S. at 555). In deciding a Rule 12(b)(6) motion to dismiss,

the Court “must accept as true all of the allegations contained in the complaint;” however, this

tenet does not apply to legal conclusions. Jd. at 678 (internal citations omitted).

DISCUSSION

The plaintiff claims that the City rule authorizing summary suspensions of OATH

registrations is unconstitutionally vague and violates the right to procedural due process. The

plaintiff also claims that the defendants violated his right to due process during the

administrative hearing by denying him the right to cross-examine all of his accusers.

The defendants respond that the City rule is not unconstitutionally vague, and that the

Constitution does not require it to provide a hearing before suspending a non-attorney

representative’s registration to appear before OATH. The defendants also argue that the claims

against John W. Burns must be dismissed because the amended complaint does not allege his

personal involvement.

I. Federal Claims

Section 1983 “is not itself □ source of substantive rights, but a method for vindicating

federal rights elsewhere conferred by those parts of the United States Constitution and federal

statutes that it describes.” Ostroski v. Town of Southhold, 443 F. Supp. 2d 325, 335 (E.D.N.Y.

2006) (citing Baker v. McCollan, 443 U.S. 137, 144 n.3 (1979)).. The challenged conduct must

(a) be attributable at least in part to action under the color of state law, and (b) deprive the

plaintiff of a right guaranteed under the Constitution of the United States. Jd. (citing Snider v.

Dylag, 188 F.3d 51, 53 (2d Cir. 1999) (citation omitted)).

Since OATH claimed it suspended the plaintiffs registration pursuant to City rules, there

is no doubt that the defendants acted “under color of law.” The only question is whether the

defendants’ actions deprived the plaintiff of “any rights, privileges, or immunities secured by the

Constitution and laws.” 42 U.S.C. § 1983.

a. Summary Suspension — Procedural Due Process

The plaintiff argues that the defendants’ failure to provide him a hearing before they

suspended him violated his Fourteenth Amendment rights. The defendants counter that a pre-

deprivation hearing is not required under the Constitution; the defendants cite the availability of

post-deprivation measures and the City’s overarching interest in ensuring the validity and

integrity of the OATH tribunal.

The Fourteenth Amendment provides that the State may not “deprive any person of life,

liberty, or property without due process of law.” U.S. CONST. amend. XIV. To determine the

level of process due, courts look to the three-part test articulated by the Supreme Court in

Mathews v. Eldridge, 424 U.S. 319, 334 (1976). Under the Mathews test, courts weigh: (1) the

private interest affected by the state action; (2) the risk of erroneous deprivation through the

procedures used and the value of additional procedural safeguards; and (3) the government’s

interest in taking the challenged action. /d. at 335 (citing Goldberg v. Kelly, 397 U.S. 254, 263-

271 (1970)).

“The weight of the private interest depends on both the nature of the private interest and

the duration of the deprivation.” Padberg v. McGrath-McKechnie, 203 F. Supp. 2d 261, 277

(E.D.N.Y. 2002), aff'd, 60 F. App’x 861 (2d Cir. 2003) (citing Gilbert v. Homar, 520 U.S. 924,

932 (1997) (citations omitted)). The parties do not dispute that the nature of the plaintiff's

interest implicates his livelihood and is therefore substantial. (See, e.g., ECF No. 26, Defs.’ Br.,

at 11 (“The plaintiffs interest in the continued ability to appear as a non-attorney representative

before OATH pending the outcome of a hearing due him is a substantial one.”). That position is

supported by case law. See, e.g., Padberg, 203 F. Supp. 2d at 277 (“Plaintiffs’ interest in their

taxicab license is profound. Suspending their licenses does far more than inconvenience drivers;

it deprives them of their very livelihood.”); Bell v. Burson, 402 U.S. 535, 539 (1971) (a driver’s

license, once issued, could become “essential in the pursuit of a livelihood”).

Nevertheless, the defendants argue that the plaintiff's interest is less substantial because

of the short duration of the suspension. Indeed, the Supreme Court has held that a plaintiff's

substantial interest in his continued livelihood can be rendered insubstantial “‘so long as the

suspended employee receives a sufficiently prompt post-suspension hearing.” Gilbert, 520 U.S.

at 932. That the plaintiff here received a hearing two weeks after his notice of suspension, the

defendants argue, diminishes his interest in the registration.

This argument is not persuasive. Although the rule provides that summarily suspended

representatives “will be given an opportunity to be heard,” nothing in the rule guarantees that the

. hearing will take place “promptly” after the suspension, or that the hearing “prescribed by the

Chief Administrative Law Judge” will provide a meaningful opportunity to challenge the

suspension on its merits. See N.Y. Comp. Codes R. & Regs. Tit. 48, § 6-25(d)(2). In other

words, the rule on its face offers scant protections to ensure that representatives suspended under

(d)(1) can avoid the prospect of extended suspensions during which they will be unable to earn a

living. See Padberg, 203 F. Supp. 2d at 278 (“[A]lthough the TLC Rules seem crafted to avoid

delay and ensure prompt review of suspension, in practice their protections are illusory. Drivers

are still faced with the prospects of extended periods without the means to earn a living.”).

Accordingly, I find that the plaintiff's interest in the registration is substantial.®

The second factor under the Matthews test is “the risk of erroneous deprivation of such

interest through the procedures used, and the probable value, if any, of additional or substitute

procedural safeguards.” Matthews, 424 U.S. at 335. The plaintiff argues that the risk of error

was substantial because the suspension rested on a subjective assessment of his character—that

he lacked “honesty and integrity”—and without any independent assurance that it was justified.

The defendants counter that the risk of error was minimal because it rested on six different

allegations of misconduct, three of which were in the form of declarations signed under penalty

of perjury. The defendants also argue that any risk of error is mitigated by the availability of

significant post-suspension process, including an administrative hearing (Section 6-25(d)(2)) and

an Article 78 proceeding (Section 6-25(e)).

6 Although the plaintiff received a hearing within two weeks of the suspension, it was thirty-five days

before his registration was restored. A deprivation of that length, even with a “prompt hearing,” is still

substantial. See Ei Boutary v. City of New York, No. 18-CV-3996, 2018 WL 6814370, at *6 (E.D.N.Y.

Dec. 26, 2018) (“But of course it was thirty-four days—more than a month—before the plaintiff's

_ license was restored to him, even with the ‘prompt’ hearing that he was afforded. The plaintiff's

deprivation may have been less than in Padberg, but the undisputed facts show that it was substantial

nonetheless.”) (internal citation omitted). .

10

The purpose of a pre-suspension hearing is to “assure that there are reasonable grounds to

support the suspension[.]” Gilbert, 520 U.S. at 933. Where there is readily verifiable,

independent evidence that the suspension is not unjustified—such as an arrest (Gilbert, 520 U.S.

at 933-34), indictment (FDIC v. Mallen, 486 U.S. 230, 240-41 (1988)), or affidavit of law

enforcement (Mackey v. Monirym, 443 U.S. 1, 14 (1979))—the state can dispense with a pre-

deprivation hearing because there is substantial assurance that the deprivation is not baseless,

unwarranted, or arbitrary. If the suspension is based on a subjective assessment, there is an

enhanced risk that the summary suspension is baseless no matter the source of the evidence. Ina

suit involving the summary suspension of taxicab drivers who refused service on impermissible

grounds, the Honorable Raymond J. Dearie observed:

It is the subjective nature of the evidence in service refusal suspension, inter alia,

that distinguishes this case from other cases where pre-deprivation hearings were

not required... [In Mackey], the risk of erroneous deprivation was far less because

the suspension was based on objective facts. It is relatively easy to determine

whether there is a legitimate reason to suspend someone of driving while

intoxicated. The arresting officer will have the opportunity to observe the driver’s

condition and take note of the tell-tale signs of intoxication. Such readily

verifiable evidence is not present in service refusal cases...In the case at bar, the

focus is not on fact, but on impressions readily susceptible to mistake and

misperception.

Padberg, 203 F. Supp. 2d at 278-79.

In her thoughtful and comprehensive opinion denying the plaintiff's motion to reconsider

her denial of a temporary restraining order, see Raja v. Burns, No. 19-CV-01328, 2019 WL

1118044, at *3 (E.D.N.Y. Mar. 11, 2019), Judge Chen found that the defendants provided

substantial support for their summary suspension, including three declarations signed under

penalty of perjury. Thus, the Chief ALJ’s assessment that the plaintiff lacked “honesty and

integrity” was based on more than just subjective beliefs.

11

Moreover, any risk of an erroneous deprivation is mitigated by the availability of an

Article 78 proceeding. As Judge Chen noted, the availability of several layers of post-suspension

process distinguishes this case from Padberg, where the post-suspension procedures did not

provide the drivers an opportunity to be heard on the merits, and thus “provided little, if any,

protection of the taxicab driver’s due process rights.” Jd. at *4 (quoting Padberg, 203 F. Supp.

2d at 279-800). Here, by contrast, the City rules allow the plaintiff to challenge his suspension

through an Article 78 proceeding, which the Second Circuit has “on numerous occasions” held to

be a “perfectly adequate post-deprivation remedy.” See Pierre v. N.Y.C Taxi and Limousine

Comm'n, No. 17-CV-973, 2017 WL 1417257, at *6 (E.D.N.Y. Apr. 19, 2017) (citations

omitted); see also Grillo v. N.Y.C Transit Auth., 291 F.3d 231, 234 (2d Cir. 2002) (“This court

has held on numerous occasions that where, as here, a party sues the state and its officials and

employees for the arbitrary and random deprivation of a property or liberty interest, an Article 78

proceeding is a perfectly adequate post-deprivation remedy.”) (internal quotation marks and

citation omitted). Because the plaintiff can challenge OATH’s decision on the merits in an

Article 78 proceeding, I find that the second Matthews factor weighs in favor of the defendants.

The third Matthews factor is the “[g]overnment’s interest, including the function involved

and the fiscal and administrative burdens that the additional or substitute procedural requirement

would entail.” Matthews, 424 U.S. at 335 (citation omitted). The defendants argue that

summary suspensions serve the legitimate interest of ensuring the “validity and integrity of the

Tribunal.” (ECF No. 26 at 13.) The plaintiff agrees that assuring the integrity of the tribunal is a

legitimate government interest, but disputes that the interest can be served only by a summary

suspension, and not a suspension after a hearing.

12

In assessing the strength of the government’s interest in obtaining a pre-hearing

suspension, courts look to whether “exigent” or “extraordinary” circumstances are present.

United States v. All Assets of Statewide Auto Parts, 971 F.2d 896, 903 (2d Cir. 1992) (citing

Fuentes v. Shevin, 407 U.S. 67, 91 (1972)). “These circumstances exist not just when there is an

important government interest at stake, but also when very prompt action is necessary,” Padberg,

203 F. Supp. 2d at 280 (citation omitted), such as “in cases involving pressing and immediate

threats to the public health and safety.” Jd. (citing Mackey, 443 U.S. at 17 (“We have

traditionally accorded the states great leeway in adopting summary procedures to protect public

health and safety.”)). In Mackey, the Supreme Court upheld a summary suspension statute partly

because of the government’s interest in protecting the public from drunk drivers. 443 U.S. at 17

The defendants place this case in the “pressing and immediate threat[] to the public health

and safety” category. Padberg, 203 F. Supp. 2d at 280-81. They argue that summary

suspensions protect a “vulnerable population”—taxicab drivers whose own livelihoods are at

stake—from duplicitous representatives. (ECF No. 26 at 14.) While certainly legitimate, the

government’s interest in upholding the integrity of the OATH tribunal neither implicates public

health and safety, nor requires prompt regulatory intervention. Indeed, OATH’s investigation

into the plaintiff took nearly two years during which OATH collected evidence against him.

(ECF No. 31, Decl. of Timothy Jones, {J 14-26.) The most serious allegation—that the plaintiff

misrepresented himself as an attorney—came to OATH on March 14, 2018, (ECF No. 23-5),

nearly a year before OATH suspended him. While the defendants are entitled to prosecute the

plaintiff as they see fit, the fact that they allowed him to represent “vulnerable” clients for a year

13

despite allegations of misconduct undermines the argument that a summary suspension was

necessary. Accordingly, I find that the third Matthews factor weighs in favor of the plaintiff.’

The plaintiff has a substantial interest in his registration, the defendants have a minimal

interest in obtaining a pre-hearing suspension, and any risk of an erroneous deprivation in the

summary suspension process is offset by the availability of an Article 78 hearing. Given the

strength of the plaintiffs interest in his license and the important, but not immediate, need for

OATH to maintain the integrity of its tribunals, I find as a matter of law that depriving the

plaintiff of a pre-suspension hearing violated his due process rights.

b. Summary Suspension — Constitutional Vagueness

“[T]he due process doctrine of vagueness is designed to ensure that, before risking a

deprivation of liberty or property, a person have fair notice of the type of conduct that is

prohibited...” Piscottano v. Murphy, 511 F.3d 247, 280 (2d Cir. 2007). Due process requires

that “a reasonably prudent person, familiar with the conditions the regulations are meant to

address and the objectives the regulations are meant to achieve, has fair warning of what the

regulations require.” Rock of Ages Corp. v. Sec’y of Labor, 170 F.3d 148, 156 (2d Cir. 1999)

(citations omitted). The Supreme Court has “expressed greater tolerance” for vagueness in the

civil context “because the consequences of imprecision are qualitatively less severe.” Vill. of

Hoffman Estates v. Flipside, Hoffman Estates, Inc., 455 U.S. 489, 498-99 (1982); Grayned v.

City of Rockford, 408 U.S. 104, 110 (1972) (regulations need not achieve “meticulous

specificity” and may instead embody “flexibility and reasonable breadth”) (citations omitted).

? The defendants’ argument that pre-suspension hearings would impose an excessive burden is also

unpersuasive. Since OATH guarantees a post-deprivation hearing at some point after a summary

suspension (see N.Y. Comp. Codes R. & Regs. Tit. 48, § 6-25(d}(2)), there is no additional burden

. . associated with holding one before the deprivation. See Boutary, 2018 WL 6814370, at *7 (“The

defendants do not dispute that it would be no added administrative burden for the TLC to provide a

hearing before it suspends instead of after.”) (citations, quotation marks, and alterations omitted).

14

In light of these permissive standards, the defendants argue that Sections 6-23 and 6-25

give sufficient warning that OATH practitioners may be summarily suspended for prohibited

conduct. The plaintiff argues that the standard for prohibited conduct—conduct that lacks

“honesty and integrity”—is nebulous, and that the misconduct defined in other subsections of the

OATH rules cannot be used as a reference. According to the plaintiff, only the specific

subsections that authorized the summary suspension (6-25(c) and (d)) can be evaluated for

vagueness.

The plaintiff does not cite and the Court cannot find any authority suggesting that the

Court must make a vagueness determination in a vacuum. In fact, case law demonstrates the

opposite. See, e.g., United States v. Lanier, 520 U.S. 259, 267 (1997) (“[T]he touchstone is

whether the statute, either standing alone or as construed, made it reasonably clear at the relevant

time that the defendant’s conduct was [prohibited].”). In any event, Sections 6-25(c) and (d) are

not vague. Section 6-25(d) specifies “factors to be considered in determining whether the

representative lacks honesty and integrity,” for example, “whether the representative has made

false, misleading or inappropriate statements to parties or Tribunal staff.” N.Y. Comp. Codes R.

& Regs. Tit. 48, § 6-25(d)(2). This content gives a reasonably prudent OATH practitioner fair

warning about the kind of conduct that merits a summary suspension. Accordingly, this claim is

dismissed as a matter of law as against all defendants.

c. OATH Hearing — Right to Cross-examination

The plaintiff argues that he was denied due process at his administrative trial before

OATH because two of the four clients who accused him of wrongdoing submitted statements in

lieu of testifying; the plaintiff says that he should have been permitted to cross-examine them.

The defendants respond that the due process clause is not violated when hearsay evidence is

15

submitted during an administrative hearing or trial. At oral argument, I asked what effect the

parties’ settlement agreement—which they negotiated before the trial was complete—had on this

claim. The parties addressed this question in supplemental briefing. (See ECF Nos. 46 and 48.)

As a preliminary matter, there is no absolute due process right to cross-examine witnesses

during an administrative hearing or trial. See Yancey v. Apfel, 145 F.3d 106, 112-13 (2d Cir.

1998). Rather, an ALJ has the discretion to permit witness testimony “where reasonably

necessary to a full development of the evidence in the case.” /d. at 113 (quoting Flatford v.

Chater, 93 F.3d 1296, 1307 (6th Cir. 1996)). In Yancey, for example, the Second Circuit

concluded that it was not an abuse of discretion for the ALJ to deny a claimant the right to cross-

examine a doctor whose medical report contributed to an adverse finding of disability. Jd.

(“After weighing the evidence, the ALJ found that although Yancey suffered from multiple pains

and fatigue, she did not have an impairment or combination of impairments listed in the pertinent

regulations. Under these circumstances, we believe that there was no deprivation of due process

as the ALJ acted well within his discretion by refusing to subpoena Dr. Wong.”).

In any event, the plaintiff waived his right to challenge the way the hearing was handled

when he entered into a settlement agreement before a decision in the OATH proceeding. A

plaintiffs right to assert a court challenge “is subject to waiver, just as other personal

constitutional rights that dictate the procedures by which civil and criminal matters must be

tried.” Commodity Futures Trading Comm’n v. Schor, 478 U.S. 833, 848-49 (1986) (citations

omitted). A plaintiff's waiver may be explicit or implied. See id. (finding that the respondent

effectively waived his right to proceed in federal court by electing to resolve the dispute through

an administrative hearing). Here, the plaintiff could have elected to see the administrative trial

through to the end, with a ruling by the ALJ. Had the ALJ ruled against him, he couldhave

16

appealed (see N.Y. Comp. Codes R. & Regs. Tit. 48, § 6-19), and raised the claim he seeks to

press in this Court. But the plaintiff did not pursue that route. Instead, he voluntarily entered

into a settlement agreement, which resolved the matters covered by the hearing “with prejudice,”

consistent with the parties’ “wish to resolve this matter without further proceedings.” (ECF No.

20.) By settling the case, the plaintiff waived his right to contest the way the hearing was

conducted, including the ALJ’s evidentiary rulings.

Alternatively, I find that under the circumstances of this case the cross-examination

question is moot. The Constitution limits the subject matter jurisdiction of the federal courts to

disputes involving “live cases and controversies.” Cnty. of Suffolk v. Sebelius, 605 F.3d 135, 140

(2d Cir. 2010) (citation omitted). When “the issues presented are no longer live or the parties

lack a legally cognizable interest in the outcome,” Murphy v. Hunt, 455 U.S. 478, 481 (1982)

(citations omitted), the case becomes moot and must be dismissed, Russman v. Bd. of Educ. of

Enlarged City Sch. Dist. of City of Watervliet, 260 F.3d 114, 119-20 (2d Cir. 2001). Likewise,

“Tt]he settlement of an individual claim typically moots any issues associated with it.” United

Airlines, Inc. v. McDonald, 432 U.S. 385 (1977) (Powell, J., dissenting) (citing 13B. Wright, A.

Miller, & E. Cooper, Fed. Prac. & Proc. Juris. § 3533 (3d ed.)). Accordingly, this-issue is also

moot.

Il. The Settlement

The next question is whether the settlement forecloses all of the plaintiff's claims. I find

that it does not. The defendants say that by signing a settlement agreement with a suspension .

penalty, the plaintiff conceded the legitimacy of the initial summary suspension. The plaintiff

responds that signing a settlement agreement—-particularly one with no admission of fault—

cannot be used against him to prove that the prior suspension was substantially justified. The

17

defendants’ alternative argument, presented in a footnote, is that the settlement agreement bars

the entire action.

First, the settlement agreement does not bar the entire action because the plaintiff did not

waive his right to challenge the summary suspension in federal court. On the contrary, the

settlement agreement is limited to resolving the administrative hearing pending in the OATH

tribunal before ALJ Casey. It makes no reference to this lawsuit, and contains no releases of

claims for OATH or the City. Interpreting this settlement agreement according to general

principles of contract law, see Powell v. Omnicom, 497 F.3d 124, 128 (2d Cir. 2007), I find that

the plaintiff did not waive, either expressly or implicitly, his right to continue prosecuting the

summary suspension in federal court.

Second, the settlement agreement does not preclude a claim for compensatory damages.

Under Carey v. Piphus, 435 U.S. 247 (1978), a plaintiff cannot recover compensatory damages

for a violation of procedural due process if the ultimate deprivation was justified. The

defendants argue that a settlement agreement with a temporary suspension component proves

that the plaintiff's summary suspension was justified. In other words, the defendants claim that

the plaintiff is estopped from arguing that the summary suspension was unconstitutional in the

federal forum, because of issues “decided” in the settlement agreement in the administrative

tribunal. As a general principle, however, “issue preclusion attaches only ‘when an issue of fact

or law is actually litigated and determined by a valid and final judgment, and the determination is

essential to the judgment.’” Arizona v. California, 530 U.S. 392, 414 (2000), supplemented, 531

U.S. 1, (quoting Restatement (Second) of Judgments § 27, p. 250 (1982)). In light of this

principle, “settlements ordinarily occasion no issue preclusion...unless it is clear...that the

parties intend their agreement to have such an effect.” Jd.

18

The plaintiff entered into a settlement agreement that included a temporary suspension

but no admission of wrongdoing. By entering into the settlement agreement, the plaintiff did not

concede that the original summary suspension was legitimate. After all, parties settle for myriad

reasons. See United States v. Int'l Bldg. Co., 345 U.S. 502, 505 (1953) (the parties’ agreement

had no issue-preclusive effect because “[a]s the case reaches us, we are unable to tell whether the

agreement of the parties was based on the merits or on some collateral consideration.”). The

plaintiff claims that he agreed to serve a brief suspension with no admission of wrongdoing

because he was facing the prospect of a permanent loss of his livelihood, not because he

“ultimately agreed to the 35-day suspension.” (See ECF No. 29, Defs.’ Opp’n Br., at 10.)

Accordingly, the plaintiff is entitled to prove compensatory damages in a trial.

TI. State Law Claims

The Court exercises supplemental jurisdiction over the plaintiff's state law claims

pursuant to 28 U.S.C. § 1367(a). The plaintiff's fifth and sixth claims for relief are a

repackaging of his due process claims as violations of OATH rules or the New York City

Charter. Accordingly, the motion to dismiss those claims is granted in part and denied in part as

discussed above.

IV. Defendant Burns

The defendants argue that the complaint must be dismissed against John W. Burns

because it does not allege his personal involvement in the alleged constitutional violations. The

plaintiff responds that the allegations against Supervising ALJ Burns—that he signed the

summary suspension letter and wrote two designation letters to the ALJ—are sufficient to

establish his direct involvement in the alleged constitutional violations.

19

A supervisory official will not be found liable under Section 1983 simply by virtue of his

“high position of authority.” Villafane v. Sposato, No. 16-CV-3674, 2017 WL 4179855, at *12,

(S.D.N.Y. Aug. 22, 2017) (quoting Al-Jundi v. Estate of Rockefeller, 885 F.2d 1060, 1065 (2d

Cir. 1989) (citations omitted)), report and recommendation adopied, 2017 WL 4157220

(E.D.N.Y. Sept. 15, 2017). Rather, a plaintiff in a Section 1983 action must show that the

supervisor was personally involved in a constitutional violation by: (1) directly participating in

the violation; (2) failing to remedy the wrong after it comes to his attention; (3) creating a policy

or custom under which unconstitutional practices occur, or allowing the continuation of such

custom and policy; (4) being grossly negligent in supervising subordinates who committed the

wrongful acts; or (5) failing to act on information indicating that unconstitutional acts are

occurring. See Colon v. Coughlin, 58 F.3d 865, 873 (2d Cir. 1995).

It is undisputed that Supervising ALJ Burns authored the letter summarily suspending the

plaintiff from appearing as a non-attorney representative. (Defs.’ Response 56.1 § 22.) In fact, it

was Supervising ALJ Burns who decided that the plaintiff's actions merited a suspension without

a hearing:

In accordance with OATH rule 6-25(d)(1), I have reviewed the fair and credible

evidence which indicates a lack of honesty and integrity that adversely affects

your practice before OATH. I therefore summarily suspend you from appearing

and representing individuals at OATH beginning March 8, 2018 subject to my

final determination in this proceeding.

(ECF No. 23-2 at 3) (emphasis in the original.)

Since the summary suspension violated the plaintiff's right to due process—and since

Supervising ALJ Burns authorized the summary suspension—he is personally liable for the

violation as a matter of law.

20

The defendants argue that even if there was a constitutional violation, Supervising ALJ

Burns is entitled to qualified immunity because his conduct did not violate clearly established

law. “Qualified immunity protects officials from liability for civil damages as long as ‘their

conduct does not violate clearly established statutory or constitutional rights of which a

reasonable person would have known.’” Gilles v. Repicky, 511 F.3d 239, 243 (2d Cir. 2007)

(quoting Harlow v. Fitzgerald, 457 U.S. 800, 818 (1982)). “When a defendant invokes qualified

immunity...courts engage in a two-part inquiry: whether the facts shown ‘make out a violation

of a constitutional right,’ and ‘whether the right at issue was clearly established at the time of

defendant’s alleged misconduct.”” Taravella v. Town of Wolcott, 599 F.3d 129, 133 (2d Cir.

2010) (quoting Pearson v. Callahan, 555 U.S. 223 (2009)). Because the facts make out a

violation of the plaintiff's rights to procedural due process, I focus on the latter inquiry: whether

the right to due process was clearly established at the time of the defendants’ summary

suspension.

In determining whether a right is clearly established, the Court considers whether “(1) the

right was defined with reasonable clarity, (2) the Supreme Court or the Second Circuit has

confirmed the existence of the right, and (3) a reasonable defendant would have understood from

the existing law that his conduct was unlawful.” Bailey v. Pataki, 708 F.3d 391, 404-05 (2d Cir.

2013) (citing Luna v. Pico, 356 F.3d 481, 490 (2d Cir. 2004)). “For a right to be clearly

established, it is not necessary that courts have agreed upon the precise formulation of the

standard.” Jd. at 405 (quotation marks and citation omitted).

It is well settled that “where the State feasibly can provide a pre-deprivation hearing it

generally must do so regardless of the adequacy of a postdeprivation remedy.” Bailey, 708 F.3d

at 405 (quoting Zinermon v. Burch, 494 U.S. 113, 132 (1990)); see also Velez, 401 F.3d at 101

21

(“Nevertheless, it has long been settled that due process generally requires a state to afford its

citizens “some kind of hearing’ prior to depriving them of liberty.”) (citation omitted). It is

equally well settled that the state ordinarily can dispense with a pre-deprivation hearing only

when there is an immediate danger to society. Jd. at 407 (“[T]he basic proposition that due

process requires a predeprivation hearing unless there is an immediate danger to society was well

established prior to 2005.”) (quotation marks and citation omitted). Accordingly, I find that

Supervising ALJ Burns’ actions violated clearly established law.

Nevertheless, even where the law is clearly established, an official is entitled to qualified

immunity if it was “objectively reasonable” for him to believe that his actions were lawful at the

time of the challenged acts. Soares v. State of Conn., 8 F.3d 917, 920 (2d Cir. 1993); see also

Davis v. Scherer, 486 U.S. 183, 190 (1984) (“Even defendants who violate [clearly established]

constitutional rights enjoy a qualified immunity that protects them from liability for damages

unless it is further demonstrated that their conduct was unreasonable under the applicable

standard.”). “Ultimately, the question is not what a lawyer would learn or intuit from

researching case law, but what a reasonable person in the defendant’s position should know

about the constitutionality of the conduct.” Velez, 401 F.3d at 100 (quotation marks and citation

omitted).

The Second Circuit has held that it is objectively reasonable for an official to believe that

his actions were lawful when those actions were taken pursuant to a presumptively valid state or

locallaw:

absent contrary direction, state officials...are entitled to rely on a presumptively

valid state statute...until and unless [the statute is] declared

unconstitutional... The enactment of a law forecloses speculation by enforcement

officers concerning [the law’s] constitutionality—with the possible exception of a

law so grossly and flagrantly unconstitutional that any person of reasonable

prudence would be bound to see its flaws.

22

Vives v. City of New York, 405 F.3d 115, 117 (2d Cir. 2005) (quoting Connecticut ex rel.

Blumenthal v. Crotty, 346 F.3d 84, 102-03 (2d Cir. 2003) (citations, quotation marks, and

alterations omitted)). In other words, an official can still claim qualified immunity for the

violation of a clearly established constitutional right if the challenged conduct involved the

enforcement of a state or local statute that is not “grossly and flagrantly unconstitutional.”

Supervising ALJ Burns authorized the plaintiff's summary suspension pursuant to

Section 6-25 of the City’s Rules and Regulations, a duly enacted regulation. Although the law

favoring pre-deprivation hearings is well settled, it is not so absolute as to render any law

authorizing summary suspensions “grossly and flagrantly unconstitutional.” Therefore, because

he relied on a regulation that was not flagrantly unconstitutional, Supervising ALJ Burns is

entitled to qualified immunity.

CONCLUSION

The Court grants summary judgment for the plaintiff on the federal and state procedural

due process claims insofar as they relate to the summary suspension of the plaintiff. The Court

dismisses all claims that the OATH rules are unconstitutionally vague and that the defendants

violated the plaintiff's right to due process by denying him the right to cross-examine all of his

accusers. The Court grants the defendants’ motion to dismiss Supervising ALJ Burns on

grounds of qualified immunity.

The Court respectfully refers this case to United States Magistrate Judge Ramon E.

Reyes, Jr. for a determination of potential damages stemming from the defendants’ due process

violation.

23

SO ORDERED.

s/Ann M. Donnelly

Ann M. Donnelly

United States District Judge

Dated: Brooklyn, New York

February 5, 2020

24